Projects following iterative software development methodologies must still be managed in a way as to maximize quality and minimize costs. However, there are indications that predicting test effort in iterative development is challenging and currently there seem to be no models for test effort prediction.This paper introduces and validates a dynamic Bayesian network for predicting test effort in iterative software devel- opment.The proposed model is validated by the use of data from two industrial projects. The accuracy of the results has been verified through different prediction accuracy measurements and statistical tests.The results from the validation confirm that the model has the ability to predict test effort in iterative projects accurately.